Bank Mizrahi announces merger with Union Bank

A branch of Bank Mizrachi-Tefahot, which announced its acquisition of the Union Bank on November, 28, 2017. (Youtube screenshot)

Israel’s fourth-largest bank, Mizrahi-Tefahot, announced Tuesday that it had signed a merger deal with the Union Bank, the country’s sixth-largest bank, for NIS 1.4 billion ($400 million).

The Union Bank’s 1,200 employees responded by striking starting from 10 a.m. and demonstrating outside the offices of the Melisron commercial real estate company in coastal Herzliya, which is controlled by the Ofer Group.

The Ofer family, along with the Wertheim family, holds the controlling share in Bank Mizrahi.

The Antitrust Authority must now decide whether to approve the merger, which reportedly has the support of Hedva Bar, the inspector of banks.

Mizrahi-Tefahot is the country’s biggest mortgage lender, with assets amounting to $67.89 billion as of the end of September, according to the company’s website. It has 185 branches — including 46 branches of its subsidiary Bank Yahav, which mainly services government and public employees.

Union Bank, known in Hebrew as Bank Igud, has more than 30 branches.

Mizrahi is interested in taking on two-thirds of Union Bank’s clerical workers and a third of those in the bank’s headquarters, The Marker business daily reported. That would mean laying off 400-500 workers.

It will reportedly buy up all the public and private shares in Union Bank, paying the owners with its own shares.

A statement from Union Bank’s workers’ committee said, “This merger is bad for the workers and bad for the general public, and only serves the interests of the strongest group of tycoons in the market who control the public’s money. We will convey today to the Ofer Group and to the Bank of Israel that we won’t let 1,200 workers be sent home.”

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